Refurbished hardware business

[minnesotacold]

Hi all!

This is my first time here and I have a few questions! I run a part time business reselling refurbished computers and so far it has been great! Very low overhead and profit margin is not bad, I guess, it is an "easy" business because there is very little sales involved but I am interested in taking it to the next level. Here in Minneapolis, we have a company that specializes in reselling refurbished servers, network equipment, etc and they are a $50 million dollar business. My idea was to get a job there to learn the business and then start a similar company in another state. I guess, my question is: Do these people approach Dell, Compaq, HP etc and start getting huge discounts due to volume of servers ordered? I am assuming they buy their servers and other network equipment directly from the manufacturers and from no other source, because how else would they be so profitable? I am assuming they can make such high profit due to their continued business and high volume discounts? I know they do a lot of cold calling and that is something I DO not do because my operation is very small but I understand how a business of this magnitude would be impossible to build without a good sales force. I guess, I have some experience in this business but I yet have so much to learn, any insight on how a business like this works would appreciated!

[ttfing]

I think you should google "IT asset management".

The old saying "it takes money to make money" holds true in this type of business. I think a lot of the smaller companies find businesses that are either upgrading their equipment or going out of business, and approach them directly with some kind of offer. This is where having the right network is critical. When you have an "in", it makes it much easier.

Maybe you can try and find local businesses that are going under or bankrupt, and talk to the manager/owner directly if they would be interested in some kind of liquidation.